The cryptocurrency market has been largely unaffected by the European Central Bank’s latest rate hike of 50 basis points, with Bitcoin, the flagship cryptocurrency, seeing only a slight drop after the announcement.
Meanwhile, in the traditional stock market, most stocks rallied after starting post-rate hike losses. However, long-term sentiment points to future pain as markets expected lenient measures from the central bank amid the turmoil of the previous day.
Bitcoin remains strong
The flagship cryptocurrency saw a slight sell-off after briefly breaching $25,000 in the hour following the ECB rate hike, trading at $24,752.58 at the time of writing.
BTC shows no signs of contagion from the traditional financial market turmoil over the past few weeks, steadily testing resistance levels above $25,000 following a staggering rise of over 15% over the past seven days. I am continuing.
The top 10 cryptocurrencies by market capitalization experienced roughly similar price movements and were generally unaffected by the ECB rate hike.
However, only BTC, Ethereum, and BNB have recorded significant weekly gains. BNB is up more than 8% over the past day.
TradFi in shambles?
European bank stocks saw their worst day since February 24, 2022 on March 15, after Credit Suisse troubles sent bank shares down 24%. The sector as a whole was down 7%.
Stocks rebounded after the Swiss central bank announced a $54 billion loan to troubled banks on March 16, hours before the rate hike.
But some analysts expect another loan will be needed later in the year, and it’s unclear whether the Swiss National Bank’s lifeline will be enough to keep the lender viable long-term.
Meanwhile, on the other side of the pond, US regulators are still dealing with two bank failures within a week, reigniting the original debate of why we need Bitcoin.
